Archive for January, 2011

Does threatening workplace safety equal just cause?

Can a lack of common sense that threatens safety be fixed through progressive discipline?

By Jeffrey R. Smith (

When an employee is guilty of misconduct at work, the employer is generally required to address the situation through a process of progressive discipline. It’s important for the employer to not be too hasty in implementing the most severe form of discipline — dismissal — too soon.

Numerous wrongful dismissal decisions have demonstrated, in Canadian employment law, that it can be very difficult to fire someone for cause. Unless an employee’s conduct is very serious — which is open to interpretation — dismissal for cause can’t happen without a process of progressive discipline that gives the employee an opportunity to mend her ways.

A Toronto Transit Commission (TTC) streetcar sits in a garage. The TTC has come under fire recently after drivers were filmed texting on cellphones while driving, raising the question of the appropriate penalty for violating workplace safety provisions. (Photo: Mike Cassese/Reuters)

But how can an employer determine what constitutes misconduct serious enough to constitute just cause for dismissal? Court files are littered with cases where an employer was certain an employee’s actions or behaviour were so bad firing was the only solution, only to find that wasn’t the case. Should being a threat to the safety of the workplace be an automatic cause for dismissal?

There’s been some controversy in Toronto after three different bus drivers were filmed texting or talking on their cellphones while driving buses in the same week. Similar circumstances happened last year when a bus driver in Portland, Oregon, was spotted browsing an ereader while driving his bus and another in Birmingham, England, was actually reading a paperback book behind the wheel.

These situations were causes of concern because it represented a threat to public safety and the drivers were in a position where their employers, as well as the general public, had to trust them to act safely. But are they just cause for dismissal without previous discipline?

Progessive discipline involves a series of escalating actions with each instance of misconduct, often starting with an oral or written warning through suspensions and finally dismissal. The key concept is that employees must be aware their misconduct is unacceptable and be given an opportunity to remedy it. However, if the misconduct is bad enough that it might harm the employer, irreparably damage the employment relationship or cause a safety risk to others, an employer might be able to skip right to dismissal. As with every case, it depends on the individual facts.

Of course, things are different in a unionized environment and the disciplinary process is usually set out in a collective agreement. In the situations outlined above, the bus drivers would each be members of a transit union, so they are unlikely to be fired unless they already have a history of serious misconduct. But maybe there should be exceptions when it comes to safety risks.

In all the cases, the drivers were not fully prepared to react if a person, car or bicycle swerved in front of them. Serious injury or death was a possible outcome of their actions. In any workplace, if an employee’s actions cause a real risk like that and a reasonable person should be aware of the consequences of those actions, should dismissal be an option for the employer?

Can it be expected to keep the employee on and trust the employee will not do it again, even though common sense should have prevented the misconduct in the first place?

Update: Both the Toronto Star and Toronto Sun reported on Feb. 1 that the three TTC drivers were being fired for their misconduct. Both the TTC and the union declined to comment as the disciplinary process was still ongoing. TTC policy has prohibited texting while driving for years and the practice has been illegal in Ontario since October 2009.

Jeffrey R. Smith is the editor of Canadian Employment Law Today, a publication that looks at workplace law from a business perspective. For more information, visit

Power and privacy

Should privacy commissioners have the power to punish?

By Jeffrey R. Smith (

In wrongful dismissal cases, without extenuating circumstances such as bad faith, the trend is for decision-makers is to award damages in relation to real losses suffered by the employee, such as pay and the time it takes to find new employment.

In other types of employment-related cases where employers are ordered to pay employees, such as human rights complaints, the idea is for the damages to compensate for other types of losses like mental distress and loss of dignity.

Privacy Commissioner Jennifer Stoddart recently indicated she was thinking about seeking some new powers for her office, such as the power to make orders, issue penalties and name organizations found in violation of the Personal Information Protection and Electronic Documents Act (PIPEDA). (Photo: Chris Wattie/Reuters)

However, in privacy cases, usually adjudicators have less power to make these types of awards. Often, at least at the provincial level, a decision ends with the employer ordered to stop violating privacy legislation and educate its workforce on privacy protection.

The federal privacy commissioner doesn’t even have order-making power. But if the current federal commissioner, Jennifer Stoddart, has her way, she might soon.

Stoddart recently indicated in a public lecture she was thinking about seeking some new powers for her office, such as the power to make orders, issue penalties and name organizations found in violation of the Personal Information Protection and Electronic Documents Act (PIPEDA). This could raise significant concerns for employers covered by the federal privacy legislation.

Employers collect and store personal information on employees, so they must be aware of the importance of protecting that information. Indeed, a careless or malicious violation of that right to privacy maybe should warrant some sort of sanction. But should privacy adjudicators have the same kind of authority courts and arbitrators have in levying punishment to the employer or compensation to the employee?

In a lot of cases where personal employee information is disclosed, the disclosure was inadvertent or the employer simply wasn’t aware which information it could or couldn’t disclose. While that doesn’t excuse it, sometimes there isn’t much harm done, so ordering the employer to stop what it’s doing — something the employer usually does as soon as the complaint is filed — and ensure its staff are up to speed on their privacy responsibilities seems like an appropriate solution.

If a privacy violation is serious enough to cause real losses to an employee, shouldn’t the matter go before a court or arbitrator instead?

Jeffrey R. Smith is the editor of Canadian Employment Law Today, a publication that looks at workplace law from a business perspective. For more information, visit

Constructive dismissal without dismissal

Will recent decision start a trend of employees not accepting changes but continuing to work?

By Jeffrey R. Smith (

When someone starts a job, she usually has a good idea what to expect with regards to job duties, pay and working environment. At least she should, and the employer should convey that information through the job interview, orientation and the formal job offer.

A basic concept in employment law is that if the employer makes any fundamental negative change to a term or condition of employment, such as job duties or pay, it constitutes a repudiation of the employment contract and the employee can claim constructive dismissal. An employer can reduce the risk of this situation by including the possibility of these types of changes in the employment contract. If it’s part of the employment contract, the employee should be prepared for the possibility of changes and consider them a part of the job. This is especially important in lines of work where frequent moving and restructuring are common.

In most cases, when an employee claims constructive dismissal through a repudiation of the employment contract, she indicates her refusal to accept the changes by leaving her employment and filing the claim. It’s been largely accepted in courts and legal circles that employees who continue working are accepting the changes in their employment contract and the new conditions become part of a new employment contract with no constructive dismissal. However, this may be changing and an employee who keeps working could still be in line for constructive dismissal damages, despite the awkwardness of her continued presence in the workplace.

Recently, the Ontario Superior Court of Justice ruled an employee of Toronto-based candy company Kerr Bros., was constructively dismissed, despite the fact he never left the company. The company had been going through financial difficulties and pared salaries in response, including cutting the long-time manager’s pay by almost half. The manager got a lawyer, who formally wrote to Kerr Bros., indicating the manager did not accept the pay reduction and was filing a constructive dismissal claim. However, the manager continued to work as usual in his regular job as he commenced the action.

Kerr Bros. tried to argue the manager accepted the changes by staying on and working for the new salary, but the court disagreed. The court said the manager made it clear through the letter from legal counsel that he didn’t accept the new salary and was pursuing legal action, even though he was still working. The court said the employer could only assume he accepted the change if he did nothing.

So employers should be aware a constructive dismissal complaint won’t necessarily be denied if the employer doesn’t leave the job. It’s important to pay attention to how the employee reacts and communicates with the employer. What could this mean for the workplace environment and productivity? Is it technically constructive dismissal if there is no actual dismissal? What is the time limit after a fundamental change to the job before an employee who keeps working can claim constructive dismissal?

Jeffrey R. Smith is the editor of Canadian Employment Law Today, a publication that looks at workplace law from a business perspective. For more information, visit

Playing head games

Mental stress causing more headaches for employers

By Jeffrey R. Smith (

You’re probably familiar with the phrase, “mind over matter.” Employers better get familiar with it, because the mind is becoming an important factor in employee claims for things like workers’ compensation and wrongful dismissal.

Mental distress has been the basis of some claims for extra damages in wrongful dismissal suits, where an employer is accused of acting in bad faith in the course of dismissal. In the past, damages for an employer’s bad behaviour in the course of dismissal were known as Wallace damages (an extension of the notice period) and were awarded in amounts often seen as arbitrarily chosen by the courts. However, the Supreme Court of Canada specified in its 2008 decision in Keays v. Honda Canada that there had to be a quantifiable loss suffered by the employee as a result of this kind of behaviour for there to be extra damages awarded.

While this new standard hasn’t always been adhered to by courts, it has changed the landscape of bad-faith damages so they aren’t awarded as often or for as large amounts. However, mental distress caused by the employer’s behaviour is still a legitimate cause for damages, particularly in discrimination cases, and they are now starting to be called “moral” damages.

A recent Ontario decision that awarded moral damages for mental distress could be cause for concern for employers. A long-term employee was awarded $20,000 in moral damages because of the employer’s “mean-spirited” conduct in firing him, in addition to 24 months’ notice. The former employee claimed he suffered from depression and personal problems after the acrimonious dismissal. However, he didn’t provide any medical evidence of the effects of his depression nor anything about any specific loss referred to the amount of $20,000, which would seem to go against the Supreme Court of Canada’s guidelines for bad-faith damages.

When mental distress comes into the picture, there could be a fine line between what part of it may be caused by bad behaviour by the employer or the dismissal itself. Stress can be a normal part of work and a normal part of termination of employment relationships. How can one determine whether or how much of stress is caused by one or the other? The Ontario Superior Court of Justice stated in 2007 that for employers to be liable for employees’ mental stress, their conduct must be “extreme, flagrant or outrageous” that intends to cause harm to the employee.

Mental stress is also becoming more common in workers’ compensation claims but, in many jurisdictions, it must be caused by an unusual event, not normal work stress.  The key to success or failure for most claims is whether the evaluators determine what qualifies as an unusual or unexpected event in the course of the employee’s particular job.

Mental stress is becoming a significant factor in cases that can end up getting employees extra money, whether it’s in wrongful dismissal decisions or workers’ compensation claims. However, different people react differently to stressful situations, partly due to their perspective. How does one differentiate between normal work stress and  unwarranted mental distress caused by extraordinary circumstances or conduct?

Jeffrey R. Smith is the editor of Canadian Employment Law Today, a publication that looks at workplace law from a business perspective. For more information, visit

The sun never sets on a career

Employers can no longer depend on retirement to refresh the workforce

By Jeffrey R. Smith (

Once upon a time, it was standard for people to retire by the time they hit age 65. In robust economic times, people were able to build nest eggs so they could retire as early as their 50s. However, with the aging baby boomer population, tighter wallets and increased human rights awareness, the tide towards older workers is shifting to the point where it’s not legal for an employer to give an employer the golden handshake at 65 if the employee doesn’t want to go.

Two Air Canada pilots who were forced to retire when they turned 65 because of international regulations and the fact it was a “normal” retirement age in the profession. However, they were later ordered reinstated. (Photo: Andy Clark/Reuters)

Pretty much every jurisdiction in Canada has outlawed mandatory retirement for employees who reach age 65. For example, the Ontario Human Rights Code used to prohibit discrimination based on age only for those aged 18 to 65. However, in 2006, it was changed so protection against age discrimination was extended to everyone over 18. This effectively prevented employers from pushing 65-year-old employees out the door.

The new protections for workers over 65 has brought established mandatory retirement agreements and benefits agreements under fire as aging employees challenge age-based restrictions in employment contracts. In spring 2010, a Quebec tribunal ruled that province’s workers’ compensation legislation violated human rights legislation because it allowed for reduced benefits when workers turned 65, despite the fact the average retirement age in Quebec was 59 and the province argued a reduction of income would normally be expected. There have been other cases where employee benefits plans that reduced benefits for employees when they reached 65 years of age have been challenged.

Another recent prominent case was that of two Air Canada pilots who were forced to retire when they turned 65 because of international regulations and the fact it was a “normal” retirement age in the profession. However, they were later ordered reinstated because the availability of domestic routes prevented mandatory retirement at 65 from being necessary to the job. The case has gone to the Supreme Court of Canada.

Also recently, a partner at a B.C. law firm cried discrimination over a partnership agreement that stipulated partners must retire at age 65 was discriminatory. The case has yet to be decided, but the province’s human rights tribunal has found the firm has enough control over partners to consider them employees.

These cases show how more employees want to keep working past the age of 65 and this number will likely increase as more baby boomers reach senior citizen status. We’re at a point now where the working career is kind of like the British Empire once was: The sun never sets on it.

The elimination of mandatory retirement expands human rights protection for employees, but what kind of effect might this have on businesses? When more senior workers stay on into old age, it’s unlikely they can maintain their productivity levels and may need more sick days. And what does this mean for younger workers looking for jobs or promotions. What can employers do to address these issues?

Jeffrey R. Smith is the editor of Canadian Employment Law Today, a publication that looks at workplace law from a business perspective. For more information, visit

Subscribe to Canadian Employment Law Today

Special offer for new subscribers. Visit for more information.

Follow Canadian HR Reporter on Twitter